European Minerals of London, U.K., expects the first ore to be uncovered at its Varvarinskoye project in August 2006. Commercial gold and copper production is expected by the end of this year.

The gold-copper project comes with a capital cost of approximately US$115 million to create an open pit mine and flotation-gravity mill. Cash costs per ounce of gold (including copper credits) are estimated to be US$87 in the first year of production, and to average US$158 over the 15-year life of the mine. A total of 1.93 million oz of gold will be produced.

In preparation for start-up, European Minerals is pre-stripping the Central pit; mobile equipment delivery is ahead of schedule; the permanent camp will be complete in September; and completion of the tailings dam should occur in November.